06-03-2024, 06:20 PM
(06-03-2024, 09:39 AM)header Wrote: This is a mess...
Directionally, internalisation makes sense. But Quarz makes few errors in how they executing it, IMHO.
These include:
2) accusing/ implying ESR having no integrity. This makes ESR have to fight them to save their own reputation
3) I think Quarz didnt have a side talk with ESR to buy or sell their stake in REIT. Now is impossible due to (2)
Passing all the resolutions proposed in coming EGM will not solve the issue and likely will only lengthen the pain, unless MAS step in. Best is either ESR or Quarz exit.
hi header,
I think (3) is probably not probable. Quarz owns ~14% and ESR owns slightly over 20%. If Quarz were to acquire the entire 20% stake from ESR, it would cross 30% and would trigger the threshold for a mandatory general offer. This means Quarz needs to extend the entire offer to everyone else. They could then jolly well end up with >50% and Sabana REIT becomes their subsidiary.
Quarz is in the business of buying undervalued assets, not managing asset with low ROA. ESR is in the business of managing AUM and so it will not be selling without a good price (whether is it the asset manager or their AUM)